Paytm falls 40 per cent in two days; Poor show likely to impact upcoming IPOs

NEW DELHI: The Paytm stock (listed as One 97 Communications) fell sharply for the second straight session on Monday, wiping out investors wealth by over Rs 50,000 crore in just two sessions. The stock fell as much as 18.72 per cent intraday to Rs 1,271.25 on the BSE before paring some of the losses to end the day 13.03 per cent lower at Rs 1,360.30. The stock had ended its first session 27 per cent lower at Rs 1,564. This sharp sell-off has brought down market capitalisation of Paytm to a little over Rs 88,000 crore, compared to its IPO valuation of about Rs 1.39 lakh crore.

“In our view, the company has not left enough earning space for the investor and this is one of the reasons for the fall in stock price,” said Gaurav Garg, Head of Research, CapitalVia Global Research Limited. The poor performance of Paytm stock has casted a dark shadow for IPOs, especially the ones which are yet to report profit. Experts believe investors will now be extra cautious given the amount of money they have lost in Paytm.